48 VALUATION, DEPRECIATION AND THE RATE-BASE 
and efficiently constructed necessarily involve a larger cost for 
engineering, which should be recognized in any valuation when 
the works give evidence of such skill and efficiency. 
“The cost of engineering for additions and extensions of a 
property may be as large, or even a larger percentage of the 
total cost than for the original plant, but under a continuous 
system of regulation engineering for additions and extensions, if 
charged to current expense, should not be included in the valua- 
tion. 
“It is sometimes suggested that no engineering charge should 
be made in the acquisition of real estate, and there may be some 
cases where such a view would be substantially correct. It is 
frequently the case, however, especially where strips of land 
are to be acquired, that the engineering cost is as great as for 
other portions of the work. 
“The record of the cost of the Wachusett Reservoir, where 
the engineers had little to do with the acquisition of land other 
than to prepare the plans of the lands and to make appraisals 
of the mill property and water-rights, amounted to about 3 
per cent of the total cost of the property acquired. The per- 
centage would have been considerably larger if nearly all of the 
property had not been acquired by purchase and very little by 
condemnation proceedings. 
“The records of the New York Water-Works show that the 
engineering connected with the acquisition of land to the end of 
September, 1913, amounted to 1.87 per cent of the total expendi- 
tures on land account.” 
Am. Soc. C. E. Committee, General Expense. — The same 
committee in referring to general expenses says that these 
include: 
‘ All administrative, legal and other general expenses during 
the period of construction. Such expenses include general office 
rent, the salaries of the officers of the corporation and of the 
secretary, treasurer, legal advisers, clerks and others. Statistics 
showing the amount of such expenses in the case of corporations 
are not available to the Committee. The statistics of munic- 
ipal public service properties throw some light upon the sub- 
ject, although generally defective in that the offices are fre- 
quently in public buildings where no rent is charged and the 
financial and legal duties are performed to a large extent by 
those who receive salaries paid out of general funds.